Vietnam's Revised Land Law: The Role of Land Databases and Notarization

Discussions are actively underway regarding the expansion of land databases and the role of notarization in Vietnam's proposed amendments to the Land Law. Ms. Nguyen Thi Hong Hanh, Director of the Ho Chi Minh City Department of Justice and a delegate to the 16th National Assembly, argues that even comprehensive land databases cannot fully replace notarization because no system can verify the intentions of the parties involved. The draft law, as per Article 22, suggests that notarization for contracts involving land use rights transfers, gifts, mortgages, or capital contributions would only be required for land parcels lacking complete information in the land database. Ms. Hanh expressed concern that this approach might lead to the interpretation that notarization becomes unnecessary once the data is complete. She emphasized that notarization is not merely an administrative procedure to be simplified but a socially integrated judicial support activity. She highlighted that the essence of notarization lies in verifying not only asset information but also the legal capacity, intentions, and voluntariness of the parties engaging in a transaction – elements that no database or mechanical system can ascertain. While acknowledging the crucial role of land databases in verifying land information, preventing forged documents, and reducing transaction risks, Ms. Hanh reiterated that they cannot confirm the intentions and voluntariness of parties during contract execution. She warned that omitting notarization when data is complete could increase risks in civil transactions. Ms. Nguyen Thi Xuan, Head of the Operations Department at the Vietnam Banking Association, also proposed maintaining notarization and authentication for transactions involving the disposal of land use rights, particularly transfers, gifts, mortgages, capital contributions, and documents related to inheritance. The association has repeatedly provided feedback on this issue, viewing notarization and authentication as vital mechanisms for controlling and preventing legal risks, given the high value of land use rights and associated assets and the frequent disputes that arise. Leaders from the Vietnam Notary Association agreed, stating that there is insufficient basis to abolish the mandatory notarization and authentication requirements for land use rights transactions. They proposed continuing this requirement in the Land Law while developing an interconnected electronic mechanism to streamline the process, rather than eliminating notarization altogether. However, some delegates believe that the requirement for notarization can be reduced when complete legal data is available. Mr. Nguyen Huu Toan, Vice Chairman of the National Assembly's Committee on Economic and Financial Affairs, suggested that if data is complete and parties can verify information on the system with sufficient confidence, notarization may not be necessary. He added that individuals who remain concerned about the legal validity of their transactions can still opt for notarization services to protect their interests, aligning with market mechanisms and reducing administrative procedures. Meanwhile, Ms. Phan Thi Hong, Deputy Head of the Department of Citizen Reception and Supervision at the Vietnam Fatherland Front Central Committee, stressed the need to clarify the conditions for application. She proposed defining precisely what constitutes a "land parcel lacking complete information in the land database" to avoid practical difficulties and differing interpretations across regions. If the drafting committee still leans towards reducing notarization and authentication requirements, Ms. Xuan recommended a phased approach and a replacement mechanism that ensures equivalent legal safety, rather than a blanket abolition. She suggested that exemption from notarization should only be considered when parties, especially credit institutions, can fully access and verify information online. Under Vietnam's one-party system, legal reforms are guided by the Party. However, changes to the land system, which directly impact citizens' lives, are being carefully considered with the incorporation of diverse opinions. In a growing economy, the transparency and security of real estate transactions are crucial for attracting domestic and foreign investment. In its relations with China, as a neighboring country, geopolitical stability is prioritized, and domestic legal reforms can be seen as part of this broader strategy. Source: VnExpress